Adjusting Entries Result in a Better Matching of Revenues and Expenses

question 179

True/False

Adjusting entries result in a better matching of revenues and expenses.

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Definitions:

Sales Commissions

Payments made to sales personnel based on the amount of sales they generate, often a percentage of the sales value.

Fixed Manufacturing Expenses

Costs associated with production that do not change with the level of manufacturing output, such as salaries of managerial staff or rent of the production facility.

Fixed Selling

A category of expenses that do not vary with the level of production or sales, such as salaries of sales personnel and advertising costs.

Administrative Expenses

Overhead or general expenses related to the management and general operations of a business, including salaries of executive personnel, accounting, and HR.